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Created on: 5/14/2021 3:28:48 PM Last Update: 5/14/2021 3:29:15 PM Posted by: RTT
WARNING: This entry is 744 days old. It may contain broken links, out-dated or misleading content. Please read on with caution.
1 POST
The FED will be asked to defend risk on assets big time before Xmas (RTT Plus)
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 The heat is going to be on the FED in the next 6 months.
The $64,000 question: Will the FED defend risk on assets by buying enough debt to suppress interest rates?
POINT: The ROCK: Inflation is pressure on interest rates. The HARD PLACE: The US has huge and growing debt, they can not afford to pay the interest bill. The FED is caught between a ROCK and a HARDPLACE. The outcome is larger FED balance sheet and the release valve is a devaluation of the currency. A lower US dollar!
The FED said inflation is expected to be 'transitory', or in other words please do not sell your bonds, pretty please.
Many expect inflation to persist, of course this will force a bond bear market and higher interest rates, if the FED buys all the debt to keep 10 year interest rates under 2% their balance will explode and the US dollar will break below $88 on the DXY and risk on assets will shoot higher at rapid pace. This is Yield Curve Control (YCC).
If the FED does not buy enough debt quickly enough the VIX will rally and stocks will sink. Of course with US Mid terms in 2022 and a democrat populated FED they will do all they can to defend risk on assets (in RTT view).
POINT: A sharp (say) 5% to 20% drop in the SP500 is on the table, and if the FED reacts quickly at recovery spike like March 2020 Covid 'v' reversal can be expected. If not, down we go!
Inflation is going to get hot as each months data rolls in over the next few months.
The CEOs reporting inflation pressures.
Producer Price Index forecasts hot CPI.
Click for popup. Clear your browser cache if image is not showing.
The hot inflation is sourced from energy (oil and gas), via Transport inflation (trains, cars and trucks). The blue line below.
POINT: If oil rolls over, then so shall inflation, with a lag.
SOURCE: This post was originally posted in our private RTT Plus members blog, and released on this public blog in a time delayed manner. RTT Plus members have access to private content immediately.Please be aware links to secured RTT Plus content will not work without a RTT Plus membership.
NOTE: Posts here are the lite version, more depth on each subject can be found via our RTT Plus membership.
Changes in the world is the source of all market moves, to catch and ride the change we believe a combination
of Gann Angles,
Cycles,
Wyckoff and
Ney logic
is the best way to ride the change, after all these methods have been used successfully for 70+ years.
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Investing Quote...
..."There is what I call the behaviour of a stock, actions that enable you to judge whether or not it is going to proceed in accordance with the precedents that your observation has noted. If a stock doesn’t act right don’t touch it, because, being unable to tell precisely what is wrong, you cannot tell which way it is going."...
Jesse Livermore
.."Look at market fluctuations as your friend rather than your enemy; profit from folly rather than participate in it"..
Warren Buffett
.."The stock market is filled with individuals who know the price of everything, but the value of nothing"..
Philip Fisher
..“If a speculator is correct half of the time, he is hitting a good average. Even being right 3 or 4 times out of 10 should yield a person a fortune if he has the sense to cut his losses quickly on the ventures where he is wrong.”..
Bernard Baruch
..“The main purpose of the stock market is to make fools of as many men as possible”..
Bernard Baruch
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We at readtheticker.com hold the view that a mix of stock chart technical analysis, Richard Wyckoff, William Gann and Jim Hurst methods plus market fundamentals allows the investor to formulate a very sound market opinion. These attributes are mutually inclusive and must be weighted equally before investing or trading in any Stock, ETF, Currency, Bond, Commodity, CFD or Mutual Fund
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